Russia has become too much of salons of communication – Bulletin

Charge new customers for services does not cover the costs of the operators for the maintenance of retail networks – most of the capital expenditure in retail is not returned, the materials of “MegaFon”. The number of salons of cellular communication in Russia is excessively subscribers are increasingly purchasing phones and accessories on the Internet, and additional features connected to “Personal Cabinet”, quoted the press service of “MegaFon”, commercial Director of the operator Vlad Wolfson. By 2019 a cellular retail in Russia will be reduced: it requires more costs, not showing the same efficiency, to the report of MegaFon.

Annual cost of the “big four” (except the “Megaphone” that MTS, “Vympelcom” and “T2 RTK holding”) for the retail network development MegaFon is estimated at 60 billion rubles: the opening of each salon costs about 1-1,5 million rubles on retail spends himself “MegaFon”, its representatives did not say. According to the operator, now in its retail network of 4,000 stores, half of them franchised.

“MegaFon” in the next 3-5 years, plans to reduce its network by 25-40% to 2500-3000 salons, the report said UBS at the end of the meeting with the CEO of the company Sergey Soldatenkov in the summer of 2016, the Operator plans to focus not on the growing number of customers, but on retaining the subscriber base and by reducing retail intends to reduce the annual churn rate from 50% to 35%, told “Vedomosti” UBS analyst Roman Arbuzov: the less sales, the less the outflow. We are talking about the reduction of inefficient, obscure salons, said company representative Julia Dorokhin. In addition, MegaFon plans to reduce the number of external sales channels and physical retail, she adds.

According to the “MegaFon” in Russia there are over 23 000 phone stores belonging to the cellular operators and major retailers (see chart). The largest network manage approximately 23 600 salons and racks sales, and all of Russia with almost 28 000 cell outlets, said General Director of “Infoline-Analytics” Mikhail Burmistrov.

what communication salons in Russia, too many, it became apparent by mid-2016, says the President of “Euroset” Alexander Malis. The number of salons, the vast majority of operators for the year increased by more than 2500, he notes, but the market of phones and sim cards in the camera retail is almost not increased. That is, sales at salon operators have declined, which gives reason to talk about the excessive number of stores, said Malis. In the first half of 2016 year-on-year the number of salons of “Euroset” has not changed, he adds.

According to the company partner several sellers electronics (confirmed by several sources close to the partners of its producers), in September 2016, were sold in Russia of 3.18 million smart phones (about 6% lower than a year earlier). The number of active sim cards in the second quarter of 2016 year-on-year rose about 4% to 251,6 million (data from AC&M-Consulting).

the Number of salons has grown amid a price war in the equipment market, which began in the spring of 2016 and pays attention to the Malis. Then, MTS has terminated the contract with “Connected” (control over the retailer moved from Maxim Nogotkov to Oleg Malis, brother of Alexander) and cut prices almost to cost. MTS hoped to attract to their stores more buyers and encourage them to actively connect to the mobile Internet. Then the operator started to expand its retail, building salons under the brand and its brand “the Phone.ru”. By July 2016 MTS was 5838 salons – 37.5% more than at the end of 2014, the report of the operator.

March 2016 Vice-President of MTS on marketing and strategy, Latsanich told “Interfax”: “the Fact that we incur certain costs associated with opening points, there is pressure on EBITDA, but today we are fully compensated for all the negative effects of the exit from the “Coherent”. Compensated quantitatively.”

If MTS will see the real moves of competitors to reduce the number of points of sales, and she will be ready to optimize the retail network, says its representative Dmitry Solodovnikov. The Russian market is saturated with outlets operators and multi-brand stores, which leads to the race of reconnection and additional costs on operators, he said.

The Tele2 retail network – franchise: now in the 3300 brand showrooms and modules, the purpose of the operator – 3500-3700 objects, said his spokesman Konstantin Prokshin.

This year’s “the Messenger” will finish with approximately 2700 stores, in 2017 plans to retain their number, said his spokesman Sergey Tikhonov. The company is considering options for expanding the retail network to within 5%, he said. Representatives of “VimpelCom” did not answer the questions of “Vedomosti”.